EAST MONTPELIER — In a complex land deal that he says is still under negotiation, Gov. Peter Shumlin is on the verge of expanding his real estate holdings in East Montpelier.

Shumlin on Tuesday afternoon said he plans to buy a 16-acre tract next to the 27 acres he purchased in June. But, as was the case with that previous purchase, the latest deal is anything but conventional.

“It's complicated, and I don't want to go into too much of (the seller's) personal finances,” Shumlin said. “All I can tell you is we will work it out in the coming weeks.”

Shumlin addressed the looming transaction after the Vermont Press Bureau on Tuesday uncovered a mortgage deed on file at the East Montpelier town office. In it, a man named Jeremy Dodge appears to sign over 16 acres and a house to Foster Road LLC — the same limited liability company that Shumlin used to purchase the 27-acre parcel June 11.

Shumlin said the deed doesn't sign over the property to his LLC but rather functions as a lien designed to safeguard the $23,000 that Shumlin said he loaned Dodge in anticipation of purchasing the land.

“My intention is to buy the property,” Shumlin said. “If something fell apart, I'm protected because I have that claim against the property.”

According to town records, Dodge's property had been scheduled to go up for tax sale following years of unpaid taxes. Shumlin said he gave Dodge the money he needed — $23,000 — to cover his taxes and other liabilities while the two men work out a deal for the entire property.

Shumlin said he entered into the transaction after Dodge came to him seeking help to avoid the tax sale. Town listers in East Montpelier have valued the Dodge property at $233,700.

“I'll be honest with you, I don't believe in buying things at tax sale,” Shumlin said. “It's not something I like to do, because the homeowner … can get displaced from their home without getting any financial benefit.”

Shumlin said the $23,000 will count toward the final purchase price. Though the mortgage deed on file in East Montpelier references a “purchase and sale agreement entered into by and between Jeremy Dodge and Foster Road LLC,” Shumlin said they haven't actually settled on a purchase price.

“The details have to be finalized,” Shumlin said. “The only thing I've done is paid the property taxes and have a mortgage against the house.”

According to the mortgage deed, Shumlin's claim on the property will be rendered null and void if Dodge repays the $23,000. However, Shumlin said that's a moot provision, since he's going to buy the whole parcel anyway.

Shumlin said his loan to Dodge is interest free and that, despite the fact that he plans to close on the property within “the next six weeks,” he is going to allow Dodge to remain in his house rent free until at least July.

“I'm not making any money off him, let's put it that way,” Shumlin said.

Dodge, 52, appears to have had a tumultuous past year. In April 2011, he was charged with aggravated domestic assault and held for lack of $25,000 bail for allegedly attacking a woman at her residence.

He later pleaded guilty to felony trespass of an occupied residence and misdemeanor domestic assault. He was sentenced to one to three years in prison on the unlawful trespass charge and is currently on supervised release.

Shumlin said he was unaware of the specifics of Dodge's run-in with the law but that he's “aware he's had real challenges with drugs and alcohol.”

“He has the struggles and challenges that many addicts face in Vermont,” Shumlin said. “All I can tell you is that when he is sober, and I've never seen him not sober … he's a perfectly functional member of the community.”

The Vermont Press Bureau was unable to find a contact number for Dodge on Tuesday.

Municipalities resort to tax sales as a means of recovering outstanding tax bills on properties. In a tax sale, the landowner's tax liability is assumed by the highest bidder, who in turn receives the deed on the property. The original landowner has one year to void the deed by paying off the tax debt, plus interest, to the winning bidder. But Shumlin said the financially struggling landowners often make out terribly in those deals.

“All the town wants is to get its taxes and penalties and interest they're owed,” Shumlin said. “The property owner has a year to pay it off with interest, and then if they don't (pay it back) the person who purchased it gets the property for just the (unpaid) property taxes.”

Shumlin said he felt it would be a better deal for both him and Dodge if they avoided the tax sale. If the property went to tax sale and Dodge “hadn't been able to redeem in the next year,” Shumlin said, “he would have lost his house and not gotten a penny out of it.”

“I didn't think that was a very fair situation for him,” Shumlin said. “I didn't want to do that.”

Shumlin's previous East Montpelier land deal became the subject of intense media scrutiny last week when municipal records revealed he had purchased for $35,000 a parcel that was later valued by town listers at $147,000. The governor is building a 2,200-square-foot home on that lot.

Shumlin said the favorable price was part of a win-win deal brokered between him and four close friends.

Shumlin said he initially wanted to buy the whole of a roughly 182-acre farm off a rural back road in East Montpelier and negotiated a purchase and sale agreement with the sellers, John and Ellen Riley, in anticipation of doing so.

When he showed his find to close friends visiting from out of state, Shumlin said, they were immediately taken with the farm.

He said they pleaded with him to give up the purchase and sale agreement and that they would in exchange “peel off a small piece of land and sell it to me, at a reasonable price, and that's how we got where we are.”

The friends are contributors to Shumlin's re-election campaign.

“We were both given gifts,” Shumlin said Thursday. “I chose not to buy the farm that I was planning to buy, at their pleading, and they sold me a piece of land at a very fair and reasonable rate. We all won.”